What price education?

Gaining an MBA can be a real career accelerator and gain you a place on the
board but as Nic Paton discovered, it is also essential to ensure you grasp
fundamental strategic and business objectives

Heather Salter, HR director at entertainment company Clear Channel
Entertainment, graduated in September as an MBA from the Open University
Business School. A former secretary, she has worked her way up through Grand
Metropolitan (as was), Scottish & Newcastle and Apollo Leisure to a point
where, if it wasn’t for the fact Clear Channel is owned by a US parent, she
would now be on the board.

For her, securing an MBA on top of her OU degree and IPD qualification was
not simply an option, it was a necessity. The course, three years of distance learning
modules, tutorials once a month and a residential element, was a tough juggling
act.

But if she wanted to have credibility with the people who mattered – the
board – to go onwards and upwards, she felt she needed the qualification.

"I now have a language that lets me communicate with them. The MBA has
also changed my whole way of thinking. I am much more likely to look at what
the business needs are and tailor the solution to them rather than thinking
something is just good to do," she says.

Yet, in the three years of studying, she did not meet a single other HR
professional. While it is impossible to know with any certainty what percentage
of high-level HR professionals hold MBAs, Salter’s experience does not seem
unusual. Fewer than 2 per cent of those who studied at Henley Management
College in recent years have HR or personnel backgrounds and just three of the
300 people who graduated through the latest London Business School MBA
programme came from an HR background. The Association of MBAs (AMBA) estimates
that, out of a total membership of around 11,000 people, fewer than 40 of its
members work in HR.

"It is true, very few people in HR either have an MBA or intend to do
one," agrees Linda Holbeche, director of research at the Roffey Park Institute.
"They tend to get their qualification through the CIPD or an MSc in
organisational development or whatever. But they are reinforcing the usual
problem of HR being apparently disconnected from the business."

The HR profession is increasingly being urged to talk the language of
business. HR professionals in turn often bemoan the fact they are perceived by
chief executives, financial directors and chief operating offices as non-core –
a useful, if slightly, well, woolly adjunct to the real business of making
money. Management often sees HR in much the same way it views public relations
– glad it’s there, particularly in a crisis, but for God’s sake don’t let them
get too close to the big stuff.

For Mike Jones, director general of AMBA, the fact this view still prevails
in many boardrooms around the country, is "a real shame". But HR can
be its own worst enemy, preferring to focus on "technical"
qualifications such as the CIPD and ignoring the need for general business
skills, he argues.

"It is essential that the HR director or manager has a very strong
understanding of the constituent parts of the organisation. In many large
companies, having an MBA is a prerequisite for getting on the board. It is the
only management qualification that gives a broad perspective on the various
functions and functionalities of the business," he says.

Julia Tyler, director of the MBA programme at London Business School,
agrees. "What the MBA will do is move you out of the HR ghetto and give
you knowledge of the general business functions," she says.

Yet in one sense the MBA has become a victim of its own success. The range
and breadth of courses now offered by a plethora of organisations and
institutions, some good and others distinctly less so, has devalued the
qualification’s currency. It is important, therefore, to pick a well-respected
course. Out of 124 schools in the UK offering MBAs, AMBA only accredits 34. And
these 34 account for two-thirds of all MBA students.

"The MBA has lost its exclusivity, but against that it has become the
mainstream management qualification," admits Jones.

The qualification is increasingly becoming a must-have for the younger,
up-and-coming executive, adds Professor Leo Murray, director of the Cranfield
School of Management. To become a board-level director without an MBA or other
high-level business qualification is the exception rather than the norm. HR
professionals who want to get on should consider studying for an MBA earlier
rather than later – perhaps even at HRM level.

"If you are about to get on the board of a FTSE company the probability
is that you are 35 to 40 years of age and are pretty high up your chosen
ladder. You will probably already have done a general management programme or
an MBA. Typically, people who do an MBA are the high-fliers in the 25-to-35 age
bracket," says Murray.

An alternative option is the executive MBA, or eMBA. This is the same
qualification studied part-time on a modular basis and often through
e-learning. Many colleges have linked up with other institutions around the
world to offer eMBAs that are truly global, designed to attract high-fliers
working for multinationals. Ultimately, though, it is the qualification and the
school it is from, not how you got it, that matters, argues AMBA’s Jones. "An
MBA is an MBA is an MBA."

So, it’s easy, then; an MBA is a passport to the board. Not necessarily.
Cranfield’s Murray and LBS’ Tyler agree an MBA can be an enormous career
accelerator, but getting to the board is a different matter altogether.

"You cannot just say that HR directors are not on the board because
they do not have MBAs – that is deeply far fetched. It is about knowledge,
skills and persuasiveness," says Murray. "An MBA is extremely useful.
It gives you a vocabulary, an agenda that lets you relate to the business. But
the further up you go the less it is about qualifications and the more it is
about your experience, determination and drive."

Neither can the qualification teach an executive what life is really like on
the board, whether from an HR background or not, argues John Weston, head of
the centre for director development at the Institute of Directors. An MBA will
give you a sound under-pinning of effective management, but the IoD also runs a
diploma in company direction that aims to offer clear, distinct guidance on how
to lead and be a director. About 300 people a year go through the course.

"Most MBAs miss the unique difference of being on the board. Managing
and directing are not the same thing. There is the collective responsibility, different
legal duties and responsibilities. It is about operating beyond your function
and specialism," says Weston.

HR people need to start to emphasise HR’s strategic nature, he adds.
"Managing directors and financial directors tend not to understand that
concept very well. HR professionals really have to blow their own trumpet more.
They have to say, ‘This company will not work unless you have an effective HR
strategy in place’. They could be leaking their best people like a sieve and
not know it."

For the HR professional looking to progress up the greasy pole, it appears
the question of acquiring an MBA is increasingly becoming one of when rather
than if. Of course, some HR high-fliers will continue to make it to the board
without MBAs. But, if HR professionals want to win the battle to become an
integral part of their organisation’s strategic and business objectives, then
the MBA must become a key weapon in their arsenal.

Where MBAs come in THE pecking order

MBA: Gives a credible grounding in general management and administration skills.
Graduates will be expected to be able to "think outside the box" when
it comes to their function, be real business players and, probably, on a
fast-track to the board
* * * * *

Doctorates: PhDs can be a useful tool for focusing on business issues or problems, but
they are more usually for the serious academic. Nevertheless, they can add
gravitas to an already solid CV
*

Specialised Masters Degree: Graduates should be able to show an advancedlevel of academic and conceptual thinking and understand their
function inside out. But while they should give a sense of the broader business
picture, they may also be tightly focused on a specific function or discipline
* * * *

CIPD: A vital qualification for any self-respecting HR professional, but worth
getting behind you as fast as possible and then moving on
* *

Management Diploma: Shows you’re thinking widely about your field and how best to work within
your organisation
* * *

Key:

* * * * * stand for excellent, through to
* which has less relevance

MBA skills need continuous
updating

Once achieved, an MBA will need
updating. Indeed, a central tenet of any good MBA programme is an expectation
for life-long and continuous professional development.

Former MBA students are generally encouraged to remain in touch
with their colleges throughout the rest of their professional working life.

Four months ago, AMBA launched MBAcademy as a specific
initiative to tap into this need for life-long learning among MBA graduates.
The academy offers members a series of five-day refresher courses designed to
update their management skills with the latest thinking, open them up to new
ideas and simply allow them time to rethink some of their management beliefs.

Among other initiatives, Roffey Park launched its Strategic HR
Network in September.

This forum comprises some 30 HR professionals who can share
views, contacts, best practice and hold discussions at least twice a year. The
members will also be given software to allow them to keep in touch through
their computers outside the meetings.